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CoinGape 2025-01-17 08:45:36

US Fed Money Printing Soon As Reverse Repo Under $100B, Bitcoin Rally Ahead?

The US Fed is expecting a higher currency circulation, thereby, boosting sentiments among investors. This comes after the US Reverse Repo recorded a significant decline. Experts confirmed any further fall is certain to fuel up the money printing by the US Federal Reserve. That said, it is speculated that a lower US Reverse Repo will bring more investments into Bitcoin as investors would want to divert their funds to digital assets, especially BTC as it is leading the price charts. US Fed Tracks US Reverse Repo Drop The US Fed has its sights on the US Reverse Repo , which has slipped below $100 billion. Notably, a $65 billion declined in two just days. Any decline in the US Reverse Repo is critical since it signals the level of money supply in the economy. The higher liquidity in turn would bring more confidence among investors to allocate their funds to riskier assets such as cryptocurrencies, including Bitcoin. Investment sentiments are gaining more strength as the reported US CPI data stands at 2.9% as of December 2024. Even though the US CPI data surpassed the forecasted estimate, investors are optimistic that the inflation rate will eventually get closer to the desired mark of 2%. The US Federal Reserve is expected to cut rates only two times but developments like the US Reverse Repo falling should keep sentiments of investors bullish. Rising Yields on Long-Term US Debt Yields on the long-term US Debt are now around 5% and most of the countries, including Britain, are rethinking their investment policies. The rising yields on long-term US Debt essentially discourage risky investments throughout the world. Hence, bringing down the level of funds that would otherwise be made into such investment portfolios. Nevertheless, the US Reverse Repo and robust US employment data along with the possibility of controlling inflation further are keeping sentiments strong among investors. It is also expected that Donald Trump will revamp crypto regulations to make investments convenient and investor-friendly. Bitcoin (BTC) Rally Ahead? Given the risk appetite investors will have soon, funds are expected to be allocated to Bitcoin (BTC) similar to 2021. The Federal Reserve may proceed with money printing, but Arthur Hayes predicted that the U.S. Treasury through its General Treasury Account (TGA) would inject liquidity into the market by spending funds rather than issuing debt. The BTC price breached above $102k level again, exchanging hands at $101,634. It also reflects an increase of 8% in a week and 140% in a year, respectively. There is an uptick of 0.71% in its 24-hour trading volume and a rise of 1.84% in its open interest, according to Coinglass. Besides, the ongoing rally in Bitcoin has surpassed most of the BTC price predictions by recording a peak value of more than $100k. The second consecutive inflow into spot Bitcoin ETFs also signals a rise in interest among investors. Notably, the net inflow in Bitcoin ETFs were $626.1 million, led by BlackRock’s IBIT. The post US Fed Money Printing Soon As Reverse Repo Under $100B, Bitcoin Rally Ahead? appeared first on CoinGape .

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